Brand Positioning Strategy -Amazon, An Example

Gettyimages from Time.com

AMAZON’S POSITIONING STRATEGY

As we saw earlier that to create a category, we need to first freeze the target customer segment and understand their requirements.

  • Books was a $10 billion industry in the united states in the year 1994. A considerable percentage of people had already been buying books through mail order or through postal services — A potential customer base with a need for convenience and also familiar with mail order deliveries.
  • Generally, most of us would have a “Fear Of Failure” while trying out any new things. Consumers at that time had little exposure to online buying. They had this fear of buying goods of unknown quality. But books were pure commodities. A copy of a book in one store was identical to the same book in any other store. So, the customers had no “Fear of Unknown”. They knew what they would be getting.
  • That time, books were primarily supplied by two major distributors and this would help Bezos not to waste time in approaching individual publishers.
  • Millions of books were in print worldwide which even a massive retail store cannot stock — too many SKUs — a potential advantage for an online store since it had no such limitations. Though Jeff Bezos could not build ‘Everything store’ in the beginning he could catch the essence of the possibility of ‘unlimited selection’ in the books category.

POSITIONING — THE DIFFERENTIATION

As Amazon began to sell books online, it was beginning to find ways to establish and preserve the difference in a consumer’s mind as it was the next foundational step in building a sustainable competitive advantage.

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